GEO GROUP INC/THE (GEO) Stock Fundamental Analysis
NYSE:GEO - New York Stock Exchange, Inc. - US36162J1060 - Common Stock - Currency: USD
GEO gets a fundamental rating of 4 out of 10. The analysis compared the fundamentals against 83 industry peers in the Commercial Services & Supplies industry. GEO has a medium profitability rating, but doesn't score so well on its financial health evaluation. GEO is not valued too expensively and it also shows a decent growth rate.
1. Profitability
1.1 Basic Checks
In the past year GEO was profitable.
GEO had a positive operating cash flow in the past year.
Each year in the past 5 years GEO has been profitable.
GEO had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
GEO's Return On Assets of 1.36% is in line compared to the rest of the industry. GEO outperforms 51.81% of its industry peers.
Looking at the Return On Equity, with a value of 3.68%, GEO is in line with its industry, outperforming 54.22% of the companies in the same industry.
GEO's Return On Invested Capital of 8.58% is fine compared to the rest of the industry. GEO outperforms 67.47% of its industry peers.
The Average Return On Invested Capital over the past 3 years for GEO is below the industry average of 11.67%.
The 3 year average ROIC (7.94%) for GEO is below the current ROIC(8.58%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 1.36% | ||
| ROE | 3.68% | ||
| ROIC | 8.58% |
ROA(3y)2.34%
ROA(5y)2.22%
ROE(3y)7.12%
ROE(5y)8.19%
ROIC(3y)7.94%
ROIC(5y)6.71%
1.3 Margins
GEO has a Profit Margin of 1.63%. This is comparable to the rest of the industry: GEO outperforms 53.01% of its industry peers.
GEO's Profit Margin has declined in the last couple of years.
With a decent Operating Margin value of 12.25%, GEO is doing good in the industry, outperforming 77.11% of the companies in the same industry.
GEO's Operating Margin has been stable in the last couple of years.
GEO has a worse Gross Margin (26.42%) than 60.24% of its industry peers.
GEO's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 12.25% | ||
| PM (TTM) | 1.63% | ||
| GM | 26.42% |
OM growth 3Y0.06%
OM growth 5Y1.08%
PM growth 3Y-26.63%
PM growth 5Y-28.78%
GM growth 3Y-1.24%
GM growth 5Y1.46%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is below the Cost of Capital (WACC), so GEO is destroying value.
Compared to 1 year ago, GEO has more shares outstanding
The number of shares outstanding for GEO has been increased compared to 5 years ago.
The debt/assets ratio for GEO has been reduced compared to a year ago.
2.2 Solvency
GEO has an Altman-Z score of 2.20. This is not the best score and indicates that GEO is in the grey zone with still only limited risk for bankruptcy at the moment.
GEO has a Altman-Z score (2.20) which is comparable to the rest of the industry.
GEO has a debt to FCF ratio of 12.66. This is a negative value and a sign of low solvency as GEO would need 12.66 years to pay back of all of its debts.
With a Debt to FCF ratio value of 12.66, GEO perfoms like the industry average, outperforming 49.40% of the companies in the same industry.
GEO has a Debt/Equity ratio of 1.23. This is a high value indicating a heavy dependency on external financing.
Looking at the Debt to Equity ratio, with a value of 1.23, GEO is doing worse than 72.29% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.23 | ||
| Debt/FCF | 12.66 | ||
| Altman-Z | 2.2 |
ROIC/WACC0.94
WACC9.17%
2.3 Liquidity
A Current Ratio of 1.29 indicates that GEO should not have too much problems paying its short term obligations.
The Current ratio of GEO (1.29) is worse than 67.47% of its industry peers.
GEO has a Quick Ratio of 1.29. This is a normal value and indicates that GEO is financially healthy and should not expect problems in meeting its short term obligations.
GEO has a Quick ratio (1.29) which is comparable to the rest of the industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.29 | ||
| Quick Ratio | 1.29 |
3. Growth
3.1 Past
GEO shows a strong negative growth in Earnings Per Share. In the last year the EPS decreased by -17.44%.
GEO shows a very negative growth in Earnings Per Share. Measured over the last years, the EPS has been decreasing by -30.77% yearly.
GEO shows a strong growth in Revenue. In the last year, the Revenue has grown by 25.62%.
GEO shows a decrease in Revenue. Measured over the last years, the Revenue has been decreasing by -0.44% yearly.
EPS 1Y (TTM)-17.44%
EPS 3Y-19.54%
EPS 5Y-30.77%
EPS Q2Q%-22.22%
Revenue 1Y (TTM)25.62%
Revenue growth 3Y2.41%
Revenue growth 5Y-0.44%
Sales Q2Q%-0.17%
3.2 Future
The Earnings Per Share is expected to grow by 76.47% on average over the next years. This is a very strong growth
Based on estimates for the next years, GEO will show a quite strong growth in Revenue. The Revenue will grow by 17.33% on average per year.
EPS Next Y26.59%
EPS Next 2Y76.47%
EPS Next 3YN/A
EPS Next 5YN/A
Revenue Next Year7.64%
Revenue Next 2Y17.33%
Revenue Next 3YN/A
Revenue Next 5YN/A
3.3 Evolution
The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
The Revenue growth rate is accelerating: in the next years the growth will be better than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
The Price/Earnings ratio is 36.52, which means the current valuation is very expensive for GEO.
Compared to the rest of the industry, the Price/Earnings ratio of GEO is on the same level as its industry peers.
GEO's Price/Earnings ratio indicates a valuation a bit more expensive than the S&P500 average which is at 27.30.
A Price/Forward Earnings ratio of 11.10 indicates a reasonable valuation of GEO.
85.54% of the companies in the same industry are more expensive than GEO, based on the Price/Forward Earnings ratio.
The average S&P500 Price/Forward Earnings ratio is at 21.76. GEO is valued slightly cheaper when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 36.52 | ||
| Fwd PE | 11.1 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of GEO indicates a somewhat cheap valuation: GEO is cheaper than 67.47% of the companies listed in the same industry.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of GEO indicates a somewhat cheap valuation: GEO is cheaper than 61.45% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 27.56 | ||
| EV/EBITDA | 10.67 |
4.3 Compensation for Growth
GEO's PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
GEO's earnings are expected to grow with 76.47% in the coming years. This may justify a more expensive valuation.
PEG (NY)1.37
PEG (5Y)N/A
EPS Next 2Y76.47%
EPS Next 3YN/A
5. Dividend
5.1 Amount
No dividends for GEO!.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
25.93
-0.2 (-0.77%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCommercial & Professional Services
GICS IndustryCommercial Services & Supplies
Earnings (Last)
Earnings (Next)
Inst Owners91.27%
Inst Owner Change0%
Ins Owners1.72%
Ins Owner Change8.92%
Market Cap3.66B
Analysts82.22
Price Target42.64 (64.44%)
Short Float %6.88%
Short Ratio3.06
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | N/A |
Yearly Dividend0
Dividend Growth(5Y)N/A
DP0%
Div Incr Years0
Div Non Decr Years0
Ex-DateN/A
Surprises & Revisions
EPS beat(2)0
Avg EPS beat(2)-33.9%
Min EPS beat(2)-44.81%
Max EPS beat(2)-22.99%
EPS beat(4)1
Avg EPS beat(4)-11%
Min EPS beat(4)-44.81%
Max EPS beat(4)38.86%
EPS beat(8)2
Avg EPS beat(8)1.11%
EPS beat(12)4
Avg EPS beat(12)-0.53%
EPS beat(16)8
Avg EPS beat(16)9.22%
Revenue beat(2)0
Avg Revenue beat(2)-1.55%
Min Revenue beat(2)-2.15%
Max Revenue beat(2)-0.95%
Revenue beat(4)0
Avg Revenue beat(4)-1.69%
Min Revenue beat(4)-2.63%
Max Revenue beat(4)-0.95%
Revenue beat(8)2
Avg Revenue beat(8)-0.81%
Revenue beat(12)5
Avg Revenue beat(12)-0.08%
Revenue beat(16)6
Avg Revenue beat(16)-0.2%
PT rev (1m)-6.7%
PT rev (3m)-6.7%
EPS NQ rev (1m)2.01%
EPS NQ rev (3m)-27.88%
EPS NY rev (1m)-5.24%
EPS NY rev (3m)-20.49%
Revenue NQ rev (1m)0.07%
Revenue NQ rev (3m)-2.13%
Revenue NY rev (1m)0%
Revenue NY rev (3m)-2.01%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 36.52 | ||
| Fwd PE | 11.1 | ||
| P/S | 1.21 | ||
| P/FCF | 27.56 | ||
| P/OCF | 16.1 | ||
| P/B | 2.73 | ||
| P/tB | 7.92 | ||
| EV/EBITDA | 10.67 |
EPS(TTM)0.71
EY2.74%
EPS(NY)2.34
Fwd EY9.01%
FCF(TTM)0.94
FCFY3.63%
OCF(TTM)1.61
OCFY6.21%
SpS21.43
BVpS9.5
TBVpS3.27
PEG (NY)1.37
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 1.36% | ||
| ROE | 3.68% | ||
| ROCE | 11.44% | ||
| ROIC | 8.58% | ||
| ROICexc | 8.75% | ||
| ROICexgc | 12.1% | ||
| OM | 12.25% | ||
| PM (TTM) | 1.63% | ||
| GM | 26.42% | ||
| FCFM | 4.39% |
ROA(3y)2.34%
ROA(5y)2.22%
ROE(3y)7.12%
ROE(5y)8.19%
ROIC(3y)7.94%
ROIC(5y)6.71%
ROICexc(3y)8.16%
ROICexc(5y)7.05%
ROICexgc(3y)11.32%
ROICexgc(5y)9.67%
ROCE(3y)10.59%
ROCE(5y)8.94%
ROICexcg growth 3Y8%
ROICexcg growth 5Y5.13%
ROICexc growth 3Y6.92%
ROICexc growth 5Y4.53%
OM growth 3Y0.06%
OM growth 5Y1.08%
PM growth 3Y-26.63%
PM growth 5Y-28.78%
GM growth 3Y-1.24%
GM growth 5Y1.46%
F-Score6
Asset Turnover0.83
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.23 | ||
| Debt/FCF | 12.66 | ||
| Debt/EBITDA | 3.33 | ||
| Cap/Depr | 74.57% | ||
| Cap/Sales | 3.13% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 45.72% | ||
| Profit Quality | 269.06% | ||
| Current Ratio | 1.29 | ||
| Quick Ratio | 1.29 | ||
| Altman-Z | 2.2 |
F-Score6
WACC9.17%
ROIC/WACC0.94
Cap/Depr(3y)62.7%
Cap/Depr(5y)64.04%
Cap/Sales(3y)3.35%
Cap/Sales(5y)3.55%
Profit Quality(3y)310.14%
Profit Quality(5y)305.57%
High Growth Momentum
Growth
EPS 1Y (TTM)-17.44%
EPS 3Y-19.54%
EPS 5Y-30.77%
EPS Q2Q%-22.22%
EPS Next Y26.59%
EPS Next 2Y76.47%
EPS Next 3YN/A
EPS Next 5YN/A
Revenue 1Y (TTM)25.62%
Revenue growth 3Y2.41%
Revenue growth 5Y-0.44%
Sales Q2Q%-0.17%
Revenue Next Year7.64%
Revenue Next 2Y17.33%
Revenue Next 3YN/A
Revenue Next 5YN/A
EBIT growth 1Y9.32%
EBIT growth 3Y2.47%
EBIT growth 5Y0.63%
EBIT Next Year53.72%
EBIT Next 3YN/A
EBIT Next 5YN/A
FCF growth 1Y-25.76%
FCF growth 3Y-8.46%
FCF growth 5Y-5.84%
OCF growth 1Y-15.4%
OCF growth 3Y-5.01%
OCF growth 5Y-6.45%